After several years of development, Google has put the brakes on its project to develop its own self-driving cars.
While other companies, such as Uber and Tesla, have rolled out traditional cars that have autopilot features, Google set its sights on vehicles that lacked steering wheels and pedals. The company had been testing its fully autonomous cars in Phoenix, Austin, and Washington state throughout the last year.
Now, instead of building its own car, Google is spinning the venture off as its own company, Waymo, and will focus on developing autonomous driving software for established automakers.
It would be easy to read this news as Google chucking its original ambitious goal and backing down from what is quickly becoming a highly competitive R&D race. But it's far more likely that the company has decided to take a slower (but smarter) path to preparing its moonshot for market.
For starters, Google co-founder Sergey Brin reportedly still favors the idea of creating a car start to finish. Alphabet CEO Larry Page and CFO Ruth Porat both pushed for the move to focus on the software, but having Brin as an advocate suggests the project won't die easily.
There's also the fact that Google has taken a similar approach with other technology before. Its entry into the smartphone market started with software -- the Android operating system -- while the company continued to work on its own phones. Android appeared on Samsung phones beginning in 2008; the Google-made Nexus phones reached market two years later. While that phone hasn't necessarily caught on as much as Google might have hoped, the newest Google phone, the Pixel, has earned rave reviews since its October release, and some believe it might begin to chip away at the iPhone's market dominance.
"The fact that Google is spinning the project off into another company means some of the technology is ready for the next step, but it knows it doesn't have all the pieces yet," says tech industry analyst Jeff Kagan. And that's where a partnership comes in.
"Google is not a car company. It's not that they can't do it, but they're thinking that in order to be successful in the car space right now, they're going to have to partner with real carmakers that are also interested in the self-driving revolution," Kagan adds.
The company already has an agreement in place to license its self-driving software to Fiat Chrysler. Presumably, it may look to partner with other automakers as well. Google also has stated that it wants to launch a self-driving taxi service by the end of 2017. For now, the company hasn't said whether it has plans to resume work eventually on its own self-driving vehicles. The company did not respond to a request for comment.
"I wouldn't be surprised if five or 10 years from now, Google has a number of partnerships with its self-driving technology, but is also in the space on its own," Kagan says.
Another reason Google might not be inclined to rush its own vehicles to market: The company realizes the timing isn't right yet. If a car without a steering wheel or pedals were released today, how many people would actually want to ride in it, not to mention own it? "Consumers just aren't ready for that," Kagan says.
But as self-driving technology continues to become a reality, and as its safety is proven over time, customers will likely get more comfortable with it. In that case, Google might be ready to push its way into the market a few years down the road.
Before becoming Waymo, Google's self-driving car project was part of X, the company's moonshot lab. Google Glass and Google Brain -- the artificial intelligence venture that now includes machine learning company DeepMind -- got their start in X before "graduating" and becoming their own companies.